Norway initiates plan for responsible gas management

Jul 22, 2004 02:00 AM

The World Bank recently introduced a voluntary global standard for restricting gas flaring during oil production. The
project was initiated by the Norwegian authorities in 2001 and is led by the World Bank. The Norwegian Petroleum
Directorate has contributed its experience with the Norwegian system to the project, a system that is highly regarded
for its good environmental and resource management.
When oil is produced from the subsurface, it is accompanied by associated natural gas. In some parts of the world
this gas is released directly into the atmosphere (cold venting) or burnt off in a gas flaring system (flaring).
These methods result in large amounts of energy being wasted, as well as the emission of greenhouse gases into the
atmosphere.

On a global basis, more than 100 bn cm of associated gas is flared or cold vented each year, or more than enough to
meet the need for gas in the United Kingdom. Flaring of gas in Africa alone would be enough to produce about twice as
much electricity as the Norwegian hydroelectric power system supplies annually.
The World Bank's gas flaring initiative is a collaboration between a number of oil companies (including Statoil and
Norsk Hydro) and national authorities. The objective of the project is to achieve significant reductions of gas
flaring around the world. The countries participating in the project account for about 40 % of global cold venting
and burning of gas in flares. Attempts are being made to get additional key countries to join the project.

Norway is highly regarded for the way in which it manages its gas resources, and several countries have expressed an
interest in learning from our system. Norwegian petroleum legislation clearly states that squandering of petroleum
must be avoided, and the authorities require measures such as solutions for sale of associated gas before approval of
development and operations plans (PDOs) for oil fields is granted.
The Norwegian Petroleum Directorate (NPD) has contributed its experience with the Norwegian system to the World Bank
project. The NPD also assists several developing countries in their work to limit gas flaring. Norad finances this
aid work.

The NPD recently gave a presentation on Norwegian legislation and its consequences during the World Bank's second
international gas flaring conference in Algeria. During this conference, the World Bank introduced the new voluntary
standard for global gas flaring.
The standard includes a number of action items and milestones aimed at the oil industry and national authorities. The
standard is regarded as being beneficial for Norwegian oil companies and Norwegian industry.